Senator Ted Cruz stated on Sunday that Chinese Communist Party-linked actors are funding efforts to amplify American fears about artificial intelligence (AI), arguing the objective is to slow U.S. technological progress. In a post on X, Cruz wrote that "Chinese communists have spent a lot of money trying to scare Americans away from AI." He suggested that while concerns about AI are rational, there is a concerted effort by outside actors to deepen those fears to drive public opposition against the technology.

Cruz cited polls indicating that roughly 60% to 70% of Americans already express worries about AI. He argued that the Chinese Communist Party aims to increase this figure to 80% or 90% to generate enough public pressure to shut down AI development in the United States. The Senator's comments were part of a podcast shared on his social media channel.

US-China AI Rivalry

The allegations come amid broader discussions regarding the competitive landscape between the U.S. and China in the AI sector. Chris Miller, author of "Chip War," recently noted that China has invested less aggressively in AI than the U.S., suggesting Beijing does not view Artificial General Intelligence (AGI) with the same urgency as American companies and policymakers. Miller pointed out that China’s $295 billion AI plan is spread over five years and that Chinese firms have favored chips from Huawei over products from Nvidia Corp.

Policy and Trade Actions

Separately, the U.S. government has taken steps to tighten controls on advanced technology. The U.S. Commerce Department recently closed a loophole that allowed overseas subsidiaries of Chinese companies to obtain advanced AI chips, impacting exports from companies like Nvidia. Additionally, reports from last month indicated that Washington and Beijing were considering official AI talks ahead of a potential meeting between Donald Trump and Xi Jinping, with discussions expected to focus on AI safety risks and advanced weapons systems.

Beijing imposed export controls on ten U.S. industrial suppliers on Monday, including rare earth miners and drone manufacturers, escalating the ongoing trade tensions between the two nations. China’s Ministry of Commerce has targeted ten American industrial suppliers, including MP Materials Corp and USA Rare Earth Inc, along with drone manufacturers Teal Drones and Jaia Robotics. The list also includes California-based electronics manufacturer Aveox Inc, Ball Aerospace & Technologies Corp, and military equipment supplier Oshkosh Defense. The new regulations prohibit exports of any dual-use items originating in China to these companies.

The Ministry stated that these measures are a response to the “U.S. government’s malicious practice” and are intended to protect national security and interests, as well as to fulfill international obligations such as non-proliferation. In a separate statement on Monday, China’s Finance Ministry said it has barred 46 U.S. companies—primarily defense contractors—from participating in Chinese government procurement projects. However, foreign-funded companies registered locally in China and their affiliates are exempt from the restriction.

U.S.-China Trade Tensions Escalate

This move by China comes in the wake of increased scrutiny of Chinese tech giants by the U.S. Earlier this month, the Pentagon expanded its blacklist of companies, including Alibaba Group Holding Ltd, Baidu Inc., and BYD Co.Ltd., suspected of having ties to China’s military or defense-industrial sector. This blacklist prevents the Department from contracting directly with these companies and procuring their products or services through third parties.

At the same time, the Trump administration has reportedly postponed adding Chinese AI firm DeepSeek, memory chipmaker ChangXin Memory Technologies (CXMT), and more than 100 other Chinese companies to the U.S. Commerce Department’s Entity List, despite approval by an interagency committee last year. According to Reuters, the delay has left the companies off a blacklist that would significantly restrict their access to U.S. goods, software, and technology. The U.S. has not announced new Entity List additions since October, the longest pause in updates in over a decade.

Han Shen Lin, China country director at the consultancy The Asia Group, told CNBC that Beijing’s response appears largely symbolic rather than a major escalation in U.S.-China tensions, since most of the targeted companies have little to no significant business presence in China.